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NY officials push bill to save 500K Essential Plan insured from losing coverage
By
Caroline Lewis
Published Apr 1, 2026
Modified Apr 1, 2026
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ALEX BRANDON/POOL/AFP via Getty Images
By
Caroline Lewis
Published Apr 1, 2026
Modified Apr 1, 2026
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Notices go out on Wednesday informing some 450,000 New Yorkers they will be dropped from the public insurance program known as the Essential Plan this July as a result of federal funding cuts.
Consumers who lose coverage will be able to shop for an alternative on the state’s online insurance marketplace — although policy experts warn those plans could be prohibitively expensive for some.
But help could still be on the way.
State Sen. Gustavo Rivera and Assemblymember Amy Paulin have introduced legislation that would put in place a series of stopgap measures to prevent New Yorkers affected by the Essential Plan changes and other federal health care cuts from becoming uninsured.
The proposal is backed by community health advocates who are rallying in Albany on Wednesday to gin up support. But they will have to work quickly to get funding for the proposal in the state budget — and Gov. Kathy Hochul has yet to endorse the plan.
The final state budget was due on Wednesday, but Hochul has extended the deadline until next week.
Hochul is tightening the income eligibility requirements for the Essential Plan in order to cope with the loss of about $7.5 billion in federal funding for the program, and tapping into a trust fund that will help cover the remaining costs.
The federal cuts — included in the massive domestic policy bill President Donald Trump helped push through the Republican-led Congress last year — were part of an effort to avoid paying for insurance for certain lawfully present immigrants.
Hochul’s administration says her approach preserves coverage for most of the Essential Plan’s 1.7 million enrollees.
But consumer advocates say the state can do better.
“New York has been a leader in expanding coverage and making sure that everyone is able to access critical care and it's important that New York continues to do so,” said Becca Telzak, deputy director of the immigrant rights nonprofit Make the Road.
Rivera and Paulin's legislation would use state funding to maintain existing eligibility under the Essential Plan. It would also use state funds to restore financial assistance for lawfully present immigrants who will lose access to federal subsidies for health plans on the Affordable Care Act marketplace next year.
The Community Service Society of New York, which helped craft the proposal Rivera and Paulin introduced, initially estimated the package would cost the state about $2.3 billion a year. But proponents now say the cost could be less than $1 billion annually, depending on how it’s implemented.
To reduce the burden on taxpayers, for instance, the state could increase the fees consumers pay for Essential Plan coverage from $0 to $50 a month, or could reduce the rates health care providers get reimbursed through the Essential Plan, said Elisabeth Benjamin, director of health policy initiatives at the Community Service Society. Reimbursement rates under the plan are currently significantly higher than under the Medicaid program.
Rivera emphasized that Hochul already appropriated more than $2 billion in the budget earlier this year, just in case the Trump administration didn’t sign off on her proposal to lower the income limit for the Essential Plan. Under that scenario, the Essential Plan would have been eliminated — but state law would have still required New York to provide coverage for certain categories of immigrants under Medicaid using only state funds.
Rivera said the money Hochul set aside for that “worst-case scenario” could simply be redirected to fill in the remaining gaps in coverage.
But Michael Kinnucan, the Fiscal Policy Institute's health policy director, noted that Hochul is no longer under a legal mandate to put up that funding.
“I would say we have a moral obligation, but we don't have a legal obligation,” to fill in the remaining coverage gaps, Kinnucan said.
Hochul’s office did not respond to a request for comment on whether she supports including funds in the state budget to keep those at risk of losing coverage insured.
Hochul said in a statement Wednesday, referring to the federal legislation enacting the funding cuts, “From the beginning, I sounded the alarm about the devastating impact H.R. 1 would have on our hospitals and health care system, and made clear that no state can fully backfill cuts this severe."
She added, “My administration is committed to helping impacted individuals find the most affordable coverage available.”
This story was updated with additional comment.
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Kathy Hochul
Politics
economy
new york state
Caroline Lewis
Caroline Lewis is on the health care beat for WNYC and Gothamist. She has covered COVID, a nurses' strike, the overdose crisis and New York’s marijuana legalization effort, and spent a year investigating patients' medical bills. She always wants to hear about how everyday New Yorkers experience the health system. Got a tip? Email [email protected].
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Gothamist is funded by sponsors and member donations
Gothamist is funded by sponsors and member donations
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